Really basic question - what and why partition a hard drive ?

What a brilliant reply - many thanks !
So, what sort of size ought I to be thinking about, and what do I call the partition. Do I keep all my programs there, or just the o/s ?
I am using vista home premium.
 
Yet more great replies - thanks !
So, given that I have 2x 1tb hard drives plus a 160gb I might be best off using the smallest for the O/S and programs, then the ohers for my photos and my music - I don't need the utmost speed, but want to keep things simple. I currently am re-using an old copy of xp but have vista home premium coming soon, so will install the 3rd HD then, and can then leave xp untill I know all is working fine.
Next question - multi-booting and different o/s - why ?
 
Hmm - good point.
As you can tell from my questions, I am very new to all this, and really do appreciate all the help I am getting !
The 160 is an older HD, so maybe I will just keep the two larger ones in with a partition for the O/S.
 
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